Decentralized Digital Infrastructure: Towards Digital Commons

// 27.11.2018

Decentralized Digital Infrastructure:
Towards Digital Commons

10.10.2018, David Simon

Technological progress is on the fast track. In recent years, the technology sector has come to be dominated by a few very large multinational corporations. The scale at which these corporations operate is unprecedented. Today, they collectively provide the great majority of the worldwide digital infrastructure and are all on track to be 1-trillion-dollar-value corporations with Apple Inc. having reached that milestone just recently.[1]

Not using their software and hardware has become increasingly difficult. Through the use of their platforms, such companies have access to vast quantities of data about usage, personal data of billions of users, and increasingly user-generated data for the training of AI. There is a plethora of ethical issues in the creation and use of technology today, especially in regard to the data generated and to the question of who owns that data. Simultaneously, a new technological trend can be identified of what I will call “decentralized technologies.” Based on a peer-to-peer architecture, these technologies work on a principle in which there is no central instance that houses and manages data — often there is no central entity at all. The key potential of these technologies is to function as a means for the decentralization of digital infrastructure. Most popularly, blockchain technology has come to be the bearer of hopes for people with a wide range of ideological motivations.

I argue that privacy and data ownership are both fundamental rights, and are essential for the individual digital sovereignty. The trust of citizens in both public and private digital infrastructure has eroded. In the following, I propose to regard decentralized technologies as an opportunity and basis for governments to create public platforms that re-establish individual digital sovereignty. I propose to attempt to design and build decentralized public platforms which establish decentralized digital commons.

Consolidated Power

It seems technological progress is only accelerating. The technology sector is increasingly dominated by fewer and fewer multinational corporations with tremendous accumulated capital, brainpower, and infrastructure. The “Big Five” — Alphabet (Google), Apple, Amazon, Facebook, and Microsoft[2] — used to do seemingly innocuous things just a few years ago: Providing a search engine, selling colorful computers, running an online bookshop, or creating a website to talk to friends. At the present time, all those companies no longer are single product companies but large multifaceted corporations that are active across a wide range of sectors and employ. Among cloud hosting providers Microsoft and Amazon share roughly 70% of the market.[3] Amazon has been steadily building its own delivery infrastructure up to “last mile” deliveries, while traditional businesses start to realize their mistake in viewing Amazon as a pure shopping website.[4],[5],[6] Amazon is now in a position where more than half of American consumers start their shopping inquiries on amazon.com and 9 out of 10 consumers will look for a product on amazon.com even if they found it elsewhere[7], while at the same time it controls a large part of its own supply chain, as well as very effective means of media distribution with Amazon Prime already exceeding 100 million subscribers.[8]

Google finds itself in a similar position. It has the de facto monopoly on the search engine market, which it capitalizes through digital advertising—its primary revenue stream.

The company has been the target of criticism and lawsuits,[9] which allege Google for using their users to perform free labor: Google offers a service called “reCaptcha” which has found wide adoption.[10] According to Google “reCAPTCHA uses […] adaptive CAPTCHAs to keep automated software from engaging in abusive activities on your site. It does this while letting your valid users pass through with ease.” [11] However, the same page also states: “Every time our CAPTCHAs are solved, that human effort helps digitize text, annotate images, and build machine learning datasets.” Google is using the data it gathers this way to train its very own machine learning models.

Data has become a resource. It has been likened with oil[12] as it is a vital resource to big internet companies. Evgeny Morozov uses the term “data extractivism”[13] to refer to the “logic that drives the development of this sector […] in a direct parallel to the natural-resource extractivism that has driven the activities of energy firms and commodity producers across the globe.” In Morozov’s view the premise for this kind of extractivism is to view users as “valuable stocks of data.” The companies in question are in turn dependent on more and better data to increase their revenue from ad-driven technology or to train advanced machine learning models.
At the core of this development is an increasing consolidation of intellectual and financial capital, as well as infrastructure with a few corporations. Yet, the dominating narrative is that of “neutral” technology and inherently egalitarian—even democratizing—role as it enables the poor and oppressed to join the western middle classes and participate in the new economy. This conceptualization of the “platform economy” as principally empowering development for the individual falls short. It is important to regard the role such platforms take and the very fundamental—yet privately owned—digital structures that they are. According to Langley and Leyshon (2017), such platforms can be understood “as a distinct mode of socio-technical intermediary and business arrangement that is incorporated into wider processes of capitalization.”[14] Furthermore, such platforms “target dominance in their own niche market” and “seek to extract [monopoly] rents from their network […]”. Taking Langley and Leyshon’s invocation of platform capitalism into account, a different picture emerges, where the primary goal is again that of extraction. In his book “Platform Capitalism” (2017)[15] Nick Srnicek identifies four tendencies that “emerge from the competitive dynamics of these large platforms” since “platforms are grounded upon the extraction of data and the generation of network effects.” The four tendencies are “expansion of extraction, positioning as a gatekeeper, convergence of markets, enclosure of ecosystems.”

A fear among experts is a potential growing dependency on technology providers.[16] It is troublesome to see a push for subsidized, privatized public transport, as has recently happened with Uber, which announced its plans to effectively function as public transportation.[17] Uber already has contracts with multiple cities in Florida for subsidized transport.[18] The company also has recently tried to convince New York City to drop regulations for proposed wage floors for ridesharing companies with a staggering 100 million dollars.[19]

The state of power that such companies yield and the landscape of power that it might lead to has been described as “digital feudalism.”[20],[21] Sterling (2014) illustratively describes the analogy: “People […] are like the woolly livestock of a feudal demesne, grazing under the watchful eye of barons in their hilltop Cloud Castles.”[22] Indeed, multinational corporations in the technology sector have become increasingly powerful so that their actions often resemble that of state entity rather than a private business. Amazon has cities competing over the location of its second headquarters.[23] The process resembles a business negotiation and cities go at great length to attract the client offering financial incentives unheard of.[24] The term “technological sovereignty” has surfaced lately in the discourse around technology, cities, and public institutions in general.[25],[26] It is vital to counter the process of consolidating power with a few large multinational corporations from a market perspective, and even more importantly from the perspective of governments both on a national and local level as they struggle for technological sovereignty. The hegemony of the technological elite and the practices of data extractivism will prove difficult to break up. Measures such as the General Data Protection Regulation (GDPR) enacted by the EU in May 2018 are an essential step into the right direction and might serve as a template for other governments to implement protection of the privacy of its citizens. Antitrust laws have been taking more aggressive shape lately[27] but therein lies another question of whether antitrust laws are equipped to deal with the scale of the companies and the vast resources—economic and human—that come with them.[28]

On the term of technological sovereignty, I would like to quote the deputy mayor of Barcelona who describes what values and goals for technology a democratic city needs to pursue in his view:

“In a democratic city, technology should serve to digitally empower citizens, to protect their privacy from abuses by the public and private powers, to fight against corruption and to advance towards a more equitable and sustainable economy. That has a name: conquering technological, digital sovereignty, for the common good.”[29]

In the post-Snowden era of state surveillance, the trust of citizens is eroded in both private and public solutions. Is there a way for governments to reclaim that trust?

The central ethical issue is that of privacy and data ownership. Several questions arise in this context: How can governments become technologically sovereign while protecting citizen rights? Can a model be devised that protects citizens from abuses of both public and private powers? Can such a model establish the digital sovereignty of citizens?

The EU’s GDPR among other rights enacted a “Right to be Forgotten.”[30] These rights are an important precedent in which the EU recognizes essential rights of individuals and the handling of their data.

Decentralized Digital Commons

The applications, platforms, and the digital infrastructure in general that is run by these large corporations are predominantly constructed in a client-server architecture. Such a system is often computationally and geographically distributed in its architecture, but it retains central control of infrastructure, code, and data. In contrast to these systems, Peer-to-Peer Networks (P2P) have no central means of control. All nodes are considered equipotent and as such, they can be considered decentralized systems. Such P2P networks have a long-standing history in file sharing and allow to freely share digital media, as they do not offer a central point of control and consequently can only with difficulty be censored. However, not only individuals and communities are using P2P technologies, but also corporations use hybrid forms to offload traffic from their infrastructure to the client. For instance, the video streaming service Netflix has been causing roughly a third of the American internet traffic in 2016[31] and as such it is no wonder that Netflix has been looking to use P2P distribution methods, so viewers share video data with other viewers directly.[32]

A recently very prominent P2P technology is blockchain technology. Bitcoin was the first cryptocurrency and the blockchain. [33] Its anonymous founder(s) used the pseudonym Satoshi Nakamoto and their identity has to this day remained a mystery. Since its invention in 2008 and its launch in 2009 Bitcoin has seen continuous and substantial growth.[34] Today, many alternative cryptocurrencies exist—Bitcoin is still the largest by mining power and market capitalization—a mostly unregulated market exists surrounding cryptocurrencies. With the dramatic price increases over the past years, a large community of ideologically motivated individuals and groups has formed around this piece of technology. Nakamoto’s intention with the invention of Bitcoin was to solve peer-to-peer digital cash payments that work “without a trusted third party.” Looking at the definition above, the key issue a blockchain solves seems to be trust. Indeed, with a given blockchain-based infrastructure there is no need for trust in the participating parties of the system since the ledger follows a codified[35] protocol against which every action on the ledger is verified.

With the introduction of smart contracts through the project Ethereum, new possibilities emerged: Participants could now create procedures which are executed on the Ethereum blockchain and which can be created in such a way, that they, for example, lock up funds until a specific time has passed, or allow for voting mechanisms to be implemented on how funds in such a contract are spent.[36] Simon and Widmer (2018)[37] point out: “[Blockchain technology] emerged as a new paradigm for organization, coordination, and contractual security for all kinds of relationships (even for forming opinions and trust). […] complexity is becoming programmable, at least in the broader sense: […] When it comes to the regulation of human coexistence, the blockchain appears to be universally applicable.” However, it is important to recognize that many drivers and advocates of this technological movement of “decentralization” are generally opposed to the very concept of authority. Atzori (2015) describes the motivation of many blockchain advocates as such:

“This seems to be exactly the ultimate purpose of crypto-anarchists – as well as an implicit desire of many advocates of decentralization. […] for the most fervent blockchain advocates […] it represents the final victory of free markets and self-interested individuals over public institutions, in a process of economic liberalization which can be more properly defined as anarcho-capitalism.”[38]

Blockchain technology attracts all kinds of political ideologies. By some it is seen as the foundation on which a universal basic income can be realized, for others, it is an ultimate weapon to dismantle the state, yet again for others, it is a tool to combat corruption and transform the state. At the center of the amalgam of ideologies gathered by blockchain technology lies the idea that encryption can serve as a political tool. To defend citizens from government overreach, to uphold citizen rights, to mathematically make corruption impossible, to disintermediate most everything, to establish digital sovereignty, and an uncountable number more wishes and goals. With decentralized technologies a key feature can be identified which is the common denominator for all the hopes and dreams surrounding this technology: Decentralized technologies can decentralize digital infrastructure and services. As such, these technologies are likely the best attempt to establish a commonly owned, digital infrastructure: digital commons.

Taking into consideration the issues implied in the technological hegemony of a few large multinational corporations, and weighing the potential of decentralized technologies, I aim to make a proposal for inquiry to respond to the previously identified ethical challenges: Can governments (and citizens alike) create, use, and integrate decentralized, digital infrastructure and services to adequately respond to the technological (digital) challenges that they face? Governments on all levels are confronted with a situation described in this paper: The lack of trust in both private and public digital infrastructure and services and a potential dependency on large technological providers. Srnicek (2017) proposes that governments become proactive:

“Rather than just regulating corporate platforms, efforts could be made to create public platforms – platforms owned and controlled by the people. (And, importantly, independent of the surveillance state apparatus.) This would mean investing the state’s vast resources into the technology necessary to support these platforms and offering them as public utilities.”[39]

I propose to take Srnicek’s vision seriously. The technological means are being developed at this very moment: Decentralized technologies promise to create and protect privacy and restore the sovereignty of the individual over their own data (and money). Any democratic government should be interested to leverage these mechanisms and the ideas found within those approaches to proactively build public platforms which can come to be decentralized digital commons.

Conclusion

I have given an overview of the technological hegemony of the Big Five and their practices of data extractivism. The situation has been compared to a digital feudalism: The consolidation of power, infrastructure, as well as economic and intellectual capital puts today’s technology providers in a position where they resemble feudal lords much more than private companies. In response to the erosion of trust in both public and private digital services in relation to personal data and surveillance, the question has been raised of how governments may reclaim that trust? The central ethical issue identified is that of privacy and data ownership, or rather the lack thereof. The question stands: How can governments become technologically sovereign while protecting citizen rights?

The possibility of a decentralized digital infrastructure—decentralized digital commons—has been proposed. This has been done by pointing out recent technological developments. Among others blockchain technology. Collectively referred to as “decentralized technologies”, these technologies follow a different architectural paradigm, in which there is no central authority, no central entity or infrastructure.

It is an open and ambitious question I pose here: Can a form of digital commons, the technological sovereignty of the state, and thereby the individual digital sovereignty be established, through the use of decentralized technologies and a decentralized architecture?

[12] “The World’s Most Valuable Resource Is No Longer Oil, but Data,” The Economist, May 6, 2017, https://www.economist.com/leaders/2017/05/06/the-worlds-most-valuable-resource-is-no-longer-oil-but-data.

[13] Evgeny Morozov, “Digital Intermediation of Everything: At the Intersection of Politics, Technology and Finance,” 2017.

[17] Andrew J. Hawkins, “Uber Wants to Be Public Transportation, and I Have Some Serious Concerns,” The Verge, February 15, 2018, https://www.theverge.com/2018/2/15/17016272/uber-khosrowshahi-public-transportation-bus.

[18] Spencer Woodman, “Uber Wants to Take over Public Transit, One Small Town at a Time,” The Verge, September 1, 2016, https://www.theverge.com/2016/9/1/12735666/uber-altamonte-springs-fl-public-transportation-taxi-system.

[23] Nick Wingfield, “Amazon Chooses 20 Finalists for Second Headquarters,” The New York Times, January 19, 2018, sec. Technology, https://www.nytimes.com/2018/01/18/technology/amazon-finalists-headquarters.html.

[24] Julie Creswell, “Cities’ Offers for Amazon Base Are Secrets Even to Many City Leaders,” The New York Times, August 6, 2018, sec. Technology, https://www.nytimes.com/2018/08/05/technology/amazon-headquarters-hq2.html.